Berlusconi is gambling

Silvio Berlusconi has called for fresh elections “as soon as possible”. Berlusoni’s ministers resigned and PM Letta accused Berlusconi of telling big lie. It does not look good for the current coalition.

Erik JonesProfessor of European Studies, Director, Bologna Institute for Policy Research, Paul H. Nitze School of Advanced International Studies (SAIS), Bologna Center, The Johns Hopkins University

The story is pretty simple. Silvio Berlusconi decided that the time has come to provoke a crisis. The challenge is to do so without attracting the whole of the blame for bringing down the government. He started last week by calling on his members of parliament to sign undated letters of resignation. These would be held by the party faction leaders of both chambers until 4 October. That is the date when the Senate Commission is due to vote on removing Berlusconi from the Senate. If that Commission votes as expected, then Berlusconi’s people would hand over the letters of resignation and step down from parliament en masse. This act of protest would not technically bring down the government but it would make it hard for President Napolitano not to begin the proceedings to dissolve parliament. In this way, Berlusconi could argue that he is not attacking the Letta government; he is protesting the subversion of Italian democracy by the judicial system.

Obviously there is a lot of hair splitting involved here and no-one can fail to see what Berlusconi is doing apart from people who do not read the news papers and who get the bulk of their information from Berlusconi’s television channels. Unfortunately, that group comprises a large share of the Italian electorate.

The timing was bad for the Letta government. The prime minister was speaking at the United Nations when Berlusconi made the decision to pull his people from parliament and Letta was speaking to investors in Wall Street when the decision was announced by the press. It must have been humiliating for Letta; he was suitably upset.

Letta’s reaction was to call for a ‘clarification’ in parliament which amounts to a vote of confidence for the coalition government. He planned to attach that vote of confidence to the financial stability law and scheduled the vote for Tuesday. In the meantime, he shut down the legislative machinery. This increased the pressure on Berlusconi because the parliament must pass legislation to avoid paying property tax and to avoid a rise in the VAT on 1 October (ie Tuesday). It also meant that Berlusconi’s people would have to support the government to see these tax measures passed.

Berlusconi responded by denouncing Letta’s ‘blackmail’ and pulling his ministers from the government. Berlusconi’s pretext is that these tax measures should be passed before 1 October and by failing to do so Letta violated one of the key elements of the coalition agreement. Again, this is crazy hair splitting; again, it makes sense if you only hear one side of the story.

Letta’s response is to insist that Berlusconi’s ministers make their resignations known in parliament. If they want to step down, they will have to do so according to parliamentary procedure; they will also have to vote against the confidence motion. In this way, Letta is trying to make it clear that Berlusconi is the one who is bringing down the government. He is also trying to do so in a manner that will be almost impossible — visually (ie on television) — to spin another way.

Letta’s strategy is having the desired effect. Individual members of Berlusconi’s group are resisting the instructions they have been given and considering whether to break away and join the moderates at the center. The Sicilians are very prominent in this group, but there are other isolated individuals who would not like to resign and who could be available to support a new Letta government.

So that is where we are at the moment. We have three options ahead of us. Berlusconi could back down. He could drive forward and succeed in pulling down the government leaving nothing to replace it. Or he could drive forward and suffer from enough defections that Letta could patch things together.

I don’t think Berlusconi is going to back down. It is a matter of personal psychology. It is also the reason why I have been so bearish on Italy for the last several weeks. Berlusconi would rather do something crazy than do nothing at all; he is, above all else, the author of his own story and the master of his fate. Of course I could be wrong here. Previously I put the odds on his driving us to crisis at 70 percent; they are higher today. But there is a non-zero probability that he will suddenly pull back from the brink. He has done that twice (at least) already. He could do it again and try to live to fight another day.

But I think he will drive forward. So that leaves us to wonder whether he will succeed or fail in carrying his people along.

A lot of people I respect and admire think that Berlusconi will fail. They have confidence that there are enough reasonable people in Berlusconi’s party who would rather hold onto what they have than throw it away. These people would be treated as heroes by the moderates of the center who include a number of wealthy patrons like Luca Cordero de Montezemolo. I am sure I spelled that name incorrectly. But the point is that there is money on the sane side of the Italian political divide and not just among the crazies. Moreover, the Italian institutions are more robust than you might think. Berlusconi cannot pull enough people out of the Chamber of Deputies to deprive it of a quorum; he cannot pull enough people out of the Senate to prevent it from functioning either — particularly if there are some defections and particularly if the ten or so members of Beppe Grillo’s people who say they are going to be reasonable and vote in the interests of the country actually do so. Moreover, the President of the Republic is going to give everyone who works for stability his personal cover. He will use his bully pulpit to make it clear that Berlusconi is the author of this crisis and that anyone who works with Letta is a savior. Moreover, Napolitano can refuse to dissolve parliament and he will do so (refuse, that is) so long as there is no new electoral law. So there are good reasons to believe that this situation will hold together better than you might imagine given the games that Berlusconi has set in motion.

I think the ‘hold it together’ people are probably right in their analysis. I give them better than even odds that this is how it will play. But I keep listening to my inner bear. There are simply too many powerful actors who want to bring down this parliament and provoke early elections. Berlusconi is only one of these; Beppe Grillo is another; and Florence mayor Matteo Renzi may be a third. I don’t want to go into the thinking behind Berlusconi’s position because there is too much speculation involved.

Grillo’s position is clear and consistent. He is benefitting significantly from the collective humiliation of the Italian political class and he has argued all along that this parliament should end prematurely. Grillo’s polling numbers went down over the summer but now they are headed back up again. He will experience some defections and he is losing control over some of his parliamentarians — and that is all the more reason for him to want to get new lists together. So we should expect him to do whatever he can to make this crisis worse and not better.

Renzi’s position is more complicated. On the one hand, he does not want Letta to emerge as the man who saved the moment and the last best hope for Italy. If stability counts as a political win for Letta, then Renzi will not celebrate. But that is no reason for him to do something bad. A better reason is what will happen to the PD if the PdL (now Forza Italia) is allowed to campaign against a weak PD-led coalition from the opposition benches. Renzi has to worry about that. Over time, Berlusconi will also have plenty of opportunities to punish those who left him or, more likely, to renegotiate their loyalty. In other words, a second Letta government will only get weaker over time and the damage to the PD will only increase as any election approaches. This has to be bad news for Renzi — who hopes to lead the PD in the next elections. It would be better to cauterise the wound and be done with it.

The forces for stability are Letta and Napolitano. They are powerful forces but I think the odds are against them. Letta’s position within the PD is too weak and Napolitano cannot shield everyone forever. At some point they will both have to admit defeat, however bitter that may be. So while I would accept that my colleagues are probably right that we will see some kind of second Letta government, I doubt that government will be able to hold together for any lengthy period and I would not be surprised if it never materialized in the first place.

Davide Denti, PhD student, School of International Studies, University of Trento, Editor for East Journal

The situation in Italy is quite complex. Berlusconi de facto took away his confidence in the government by having his ministers resign, after a previous threat of mass resignation of his MPs turnout out procedurally impossible.

Berlusconi’s pretext is a matter of tax policy (the likely-to-come VAT hike) but it is understood that it is in fact a matter related to his decadence from Senator due to the final sentence for tax fraud he recently got. The PD senators refused in any way not to acknowledge the sentence. The session of the commission that should take note of the sentence and declare his decadence has just been delayed since.

Berlusconi’s spite was in doing so while Letta was at the UNGA claiming for Italy’s stability and trustworthyness.

Now Letta will likely try to force a “parliamentary crisis” by looking for a confidence vote on Monday, to uncover Berlusconi’s bluff.

Today Letta is meeting President Napolitano, who had accepted to be re-elected, despite his age (88), conditional upon parties agreeing on a grand-coalition government to end the post-election stall.

Napolitano could decide to resign himself, leaving to the next President to solve the situation. In this case, he wouldn’t be Constitutionally able to dissolve the Parliament and call for new elections (main demand of PDL and opposition M5S).

This could leave it open for PD, Monti’s SC and opposition SEL (left) and M5S (Grillo), together with eventual independents coming out of the PDL, to find a common ground to elect a new President and sustain a transitory minority government (maybe led by Letta himself) to change the electoral law before going to new elections, maybe in Spring.

All this would mean that Berlusconi is finally unable to shape politics. He still faces several other charges pending, and on Oct 15 a court decision will set the time of his incompatibility with standing for elections, due to the recent final sentence for tax fraud. He could also have to spend one year at home arrests.

The move to precipitate a government crisis looks more like a “Let Samson die with the Philistines” act, spurred by the division among the PDL between doves and hawks, and the lack of perspectives for Berlusconi himself, who looks quite cornered.

In the meantime, the PD is definitely not ready for a fast snap election, with four different contenders running for party secretary, including Renzi, and a centre-left coalition to be rebuilt.

Claudio Radaelli, Professor of Political Science, Director, Centre for European Governance, University of Exeter

I do not think we’ll go towards new elections in Italy, but there may be a different government or a re-shuffled government at the end of the confidence vote – as I argue below.

Berlusconi is gambling and taking risks by withdrawing his ministers from the Letta government. He could have resigned from MP accepting the final sentence and taking the moral high ground (if this is imaginable, given that we are talking of Berlusconi). He could have worked in a non-governmental organization (as alternative to jail) and still lead a strong movement and his party in parliament. The Radical Party has promoted a package of referendums on fair justice – this could have been the ideal Spring 2014 scenario for Berlusconi – a nation-wide campaign on the referendum on justice and magistrate. But the way the scenario looks like now, Berlusconi will certainly be booted out of parliament when the special Parliamentary Committee votes on his case, in days. He decided to move first by pushing his ministers into resignation. However, the President of the Italian Republic and the Prime Minister will not accept a crisis without a parliamentary vote of confidence. They will go for a vote of confidence on the Prime Minister – hoping that a transparent yet dramatic showdown in the parliamentary forum will divide Berlusconi’s MPs. If the government survive, it will be reshuffled – how it depends on the parliamentary sources of support. There is a constellation of forces that wants Italy to carry on with a government rather than early elections – this includes the EU leaders, the financial markets, the PD (Democratic Party of the left), the President of the Republic and of course the current Prime Minister. Yesterday the President Napolitano said that the Italians do not want new elections, but a government on top of a very demanding economic policy agenda. Napolitano added that he is ready with a message to Parliament on the situation in the Italian prisons, where Italy is behaving illegally after the sanctions of the European Court of Human Rights. Economic policy and rule of law – enough on the plate for a government to carry on?

Carlo BastasinVisiting Fellow, Center on the United States and Europe, The Brookings Institution, Editorialist, Il Sole-24 Ore

My take is that Letta will show at the Parliament on Oct 4, transparently getting himself voted out. Blaming Berlusconi for damaging the country on his personal agenda. Then Letta will resign.

Pres Napolitano will not call immediately for new elections, but give a mandate to Mrs Cancellieri (currently min of Interiors) to form a new”institutional government” change the electoral law (the current one does not grant governability besides grand coalitions) and last a few months until new elections are inevitable. At that juncture Berlusconi will have been inhibited from public offices. PD should be able to win…

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